GrCF2 W2 - Almaty Electric Public Transport

Location:

Kazakhstan

Project number:

51583

Business sector:

Municipal and environmental infrastructure

Notice type:

State

Environmental category:

B

Approval date:

09 Mar 2022

Status:

Approved

PSD disclosed:

06 Aug 2021

Project Description

The EBRD is planning to provide a senior loan of up to KZT 28.8 billion (€ 58.9 million) to Almatyelectrotrans LLP (the "Company"), a municipal public transport company in the city of Almaty (the "City"). It is envisaged, that the loan will be used to finance (i) the acquisition of 190 modern, energy efficient trolleybuses to renew the Company's existing fleet; and (ii) the rehabilitation of 10 power supply sub-stations. The Company is a public transport entity 100 per cent owned by the City. The City will provide a grant co-financing of up to KZT 11.1 billion (€ 22.7 million) for (iii) the procurement of trolleybus maintenance machinery and equipment; (iv) trolleybus depot rehabilitation; and (v) the modernisation of the trolleybus infrastructure in the City (the "Project").

Project Objectives

The Project is aimed at improving public transport services in the City in terms of quality, reliability, sustainability and environmental, health and safety standards. The Project contributes to the reduction of GHG emissions through energy efficiency increase. The Project is a 'trigger project' under the EBRD's Green Cities Framework 2 ("GrCF2") under which development of the Green City Action Plan ("GCAP") for Almaty will be covenanted in the financing agreements.

Transition Impact

ETI score: 70

The Project fully complies with the transition objectives of the Bank's GET approach and Green Cities Framework, focusing on Green as the primary transition quality through the reduction of GHG emissions and GCAP development.

The Project will also support the Inclusive objective through (i) policy dialogue to seek a limited exemption from licensing laws for trolleybus drivers, which especially affect women's access to jobs, (ii) inclusive HR practices to increase female participation in the workforce for trolleybus drivers and the executives level, and (iii) development and delivery of internally accredited trolleybus driving training programme for new employees out of which at least 35 per cent will be women.

Client Information

ALMATYELECTROTRANS LLP

The Company manages the operation of around 800 buses and 190 trolleybuses on a daily basis carrying around 180 million passengers per year (up to 50 per cent of the City's total passenger traffic, including 10 per cent covered by trolleybus operations). The Company services daily 57 bus and 9 trolleybus routes, with a total route length of around 3,000 bus km and 250 trolleybus km respectively. The Company owns 4 bus and 1 trolleybus depots including 18 active power supply sub-stations with a total capacity of more than 55 MW. The total number of employees is around 2,500.

 

EBRD Finance Summary

KZT 28,800,000,000.00

Senior secured loan of up to KZT 28.8 billion (€ 58.9 million). The loan will be backed by a Project Support Agreement ("PSA") to be signed between the Bank, the municipality ("City Akimat") and the Company.

Total Project Cost

KZT 39,900,000,000.00

A co-financing of KZT 11.1 billion (€ 22.7 million) to be provided by the City Akimat for the depot modernisation, procurement of trolleybus maintenance equipment and the rehabilitation of trolleybus infrastructure in the City.

Additionality

The Loan is a subsequent transaction with the same client in Kazakhstan. Additionality sources include the following components: (i) financing structure; (ii) risk mitigation; (iii) support to achieve higher standards; and (iv) knowledge, innovation, and capacity building.

Environmental and Social Summary

Categorised B (ESP 2019). Any environmental and social impacts potentially associated with the Project, will be site-specific and addressed through appropriate mitigation measures. An environmental and social analysis of the proposed investment as well as a review of environmental, social, health and safety policies and procedures and the capacity of the company to manage risks associated with the proposed Project was completed internally by ESD and confirmed that the Project is structured to be in line with the EBRD's Performance Requirements (PRs). The Project is also aligned with the Paris Agreement for both mitigation and adaptation, and there are no material climate hazards affecting this Project.

The environmental and social due diligence ("ESDD") was carried out by an independent consultant as part of the Feasibility Study and showed that the Project will bring substantial environmental and public health benefits through modernisation of the trolleybus fleet. The Project will improve air quality in the City, accessibility and mobility for all user groups and improve overall quality, safety and efficiency of the urban transportation. The implementation of the Project and the development of the subsequent GCAP also provides an opportunity for the City to enhance the positive impacts of the new low-floor trolleybus fleet through continuing to adapt the existing public transport infrastructure (e.g. through continuous improvement and refurbishment of the passenger stops and curbs) to be more inclusive and accessible for low-mobility user groups.

The ESDD identified that overall the Company has the institutional capacity to implement the Project in compliance with the Bank's PRs and national legislation. The project implementation is limited to the urban area within the boundaries of the existing urban development and no sensitive ecological receptors or protected areas will be affected. In addition, it is confirmed that the Project will not have significant adverse social impacts on the local communities or other project affected parties, nor will the Project require the acquisition of land or result in involuntary resettlement or economic displacement. 

An Environmental and Social Action Plan ("ESAP") has been developed for the Company to address the areas for improvement identified during the ESDD. Carrying out these necessary mitigation measures will enable the Company to comply with national regulations and the Bank's PRs. The ESAP covers among other issues the development and implementation of the Environmental Management and Occupational Health & Safety Management Systems in line with ISO 14001 and ISO 45001 respectively; improvement of the human resource policies and procedures (including on gender equality and gender based violence and harassment ("GBVH")) and improvement of the sanitary and welfare facilities for employees; ensuring that the tender documentation specifications for the trolleybuses include accessibility and inclusion requirements for vulnerable users; enforcement of sanitary protection zone ("SPZ") for all depots as per requirements of the national legislation; relocation of the Vostok bus depot in Kairat micro-district by the end of 2022 to another suitable permanent location; road safety trainings for drivers and fleet managers; improved waste management practices, as well as implementation of the stakeholder engagement plan and grievance mechanism. The environmental and social performance of the Project and implementation of the ESAP will be monitored through annual E&S reports and site visits when deemed necessary.

A Stakeholder Engagement Plan (SEP) and a Non-Technical Summary (NTS) have also been prepared for the Project and will be disclosed by the Company locally.

Technical Cooperation and Grant Financing

Pre-signing:

-       TC 1: Project Preparation: € 198,000; financed by the EBRD Shareholder Special Fund ("SSF").

 Post-signing:

-       TC 2: Development of the Green City Action Plan: € 299,300; financed by the Federal Ministry of Finance of the Republic of Austria.

-       TC 3: Procurement Support: up to € 400,000; to be financed by SSF.

-       TC 4: Corporate Development Programme: up to € 150,000; to be financed by SSF.

-       TC 5: Pre-shipment Inspection: up to € 150,000; to be financed by SSF.

Company Contact Information

Berikhan Murzakarimov, General Director
press@aet.kz
+7 (727) 313-27-84
http://aet.kz/
67 Tole bi str, Almaty, 050000, Kazakhstan

Implementation summary


PSD last updated

19 Jan 2022

Understanding Transition

Further information regarding the EBRD’s approach to measuring transition impact is available here.

Business opportunities

For business opportunities or procurement, contact the client company.

For business opportunities with EBRD (not related to procurement) contact:

Tel: +44 20 7338 7168
Email: projectenquiries@ebrd.com

For state-sector projects, visit EBRD Procurement:

Tel: +44 20 7338 6794
Email: procurement@ebrd.com

General enquiries

Specific enquiries can be made using the EBRD Enquiries form.

Environmental and Social Policy (ESP)

The ESP and the associated Performance Requirements (PRs) set out the ways in which the EBRD implements its commitment to promoting “environmentally sound and sustainable development”.  The ESP and the PRs include specific provisions for clients to comply with the applicable requirements of national laws on public information and consultation as well as to establish a grievance mechanism to receive and facilitate resolution of stakeholders’ concerns and grievances, in particular, about environmental and social performance of the client and the project. Proportionate to the nature and scale of a project’s environmental and social risks and impacts, the EBRD additionally requires its clients to disclose information, as appropriate, about the risks and impacts arising from projects or to undertake meaningful consultation with stakeholders and consider and respond to their feedback.

More information on the EBRD’s practices in this regard is set out in the ESP.

Integrity and Compliance

The EBRD's Office of the Chief Compliance Officer (OCCO) promotes good governance and ensures that the highest standards of integrity are applied to all activities of the Bank in accordance with international best practice. Integrity due diligence is conducted on all Bank clients to ensure that projects do not present unacceptable integrity or reputational risks to the Bank. The Bank believes that identifying and resolving issues at the project assessment approval stages is the most effective means of ensuring the integrity of Bank transactions. OCCO plays a key role in these protective efforts, and also helps to monitor integrity risks in projects post-investment.

OCCO is also responsible for investigating allegations of fraud, corruption and misconduct in EBRD-financed projects. Anyone, both within or outside the Bank, who suspects fraud or corruption should submit a written report to the Chief Compliance Officer by email to compliance@ebrd.com. All matters reported will be handled by OCCO for follow-up. All reports, including anonymous ones, will be reviewed. Reports can be made in any language of the Bank or of the Bank's countries of operation. The information provided must be made in good faith.

Access to Information Policy (AIP)

The AIP sets out how the EBRD discloses information and consults with its stakeholders so as to promote better awareness and understanding of its strategies, policies and operations following its entry into force on 1 January 2020. Please visit the Access to Information Policy page to find out what information is available from the EBRD website.

Specific requests for information can be made using the EBRD Enquiries form.

Independent Project Accountability Mechanism (IPAM)

If efforts to address environmental, social or public disclosure concerns with the Client or the Bank are unsuccessful (e.g. through the Client’s Project-level grievance mechanism or through direct engagement with Bank management), individuals and organisations may seek to address their concerns through the EBRD’s Independent Project Accountability Mechanism (IPAM).

IPAM independently reviews Project issues that are believed to have caused (or to be likely to cause) harm. The purpose of the Mechanism is: to support dialogue between Project stakeholders to resolve environmental, social and public disclosure issues; to determine whether the Bank has complied with its Environmental and Social Policy or Project-specific provisions of its Access to Information Policy; and where applicable, to address any existing non-compliance with these policies, while preventing future non-compliance by the Bank.

Please visit the Independent Project Accountability Mechanism webpage to find out more about IPAM and its mandate; how to submit a Request for review; or contact IPAM  via email ipam@ebrd.com to get guidance and more information on IPAM and how to submit a request.

 

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